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Planning your financial estate through a will

In my last article (Estate Planning 101), the first of a two-part series on estate planning, I shared some tips on how you can get started on structuring your estate. I covered how to establish joint tenancy, naming beneficiaries, and ensuring you have life insurance. I also discussed why it’s important that we structure our estate and not assume we are too young, or not rich enough.

In my second installment on this topic, I want to focus on how you can plan your financial estate using a will.

Since questions related to the handling of financial assets are often a major issue and a potential cause of stress for families after a loved one passes, my goal is to provide a quick overview of the process and considerations for addressing this through a will.

Consult with a lawyer or notary

A will is a complex legal document in which you lay out exactly what you want done with any assets you own when you die – property, money, investments and personal belongings. To get started on your will, book an appointment to meet with a lawyer or notary to discuss your estate and wishes. As there are rules that must be followed for the will to be valid, it is recommended that you seek expert assistance from a professional who is well qualified in this area. Taking the time to ensure your will is done right will save your loved ones from unneeded financial headaches later.

Choose an executor you trust

You will need to name an executor in your will. This is an individual who will be responsible, by law, for distributing your assets. In other words, the executor has the legal authority to deal with your estate. Your executor could be a family member, close friend or lawyer, depending on how complicated the distribution of your estate might be. The executor makes an assessment of the estate, pays debts and distributes remaining assets among beneficiaries, as determined by the will.

Appoint a guardian

In addition to determining how you want your assets distributed, it’s important to choose a guardian if you have young children. Selecting a guardian provides assurance that should you and your partner pass away, the financial needs of your children under the age of 19 will be looked after by someone you trust. Discuss your choice of a guardian with your lawyer or notary when working on your will.

Review and update your will as needed

You will need to update your will whenever your financial or personal situation changes. These changes might include the birth of a child or the purchase of new property such as a house. It’s a good rule of thumb to review your will every three to five years to make sure it reflects your current financial assets and your wishes.

Compile a list of important documents

In addition to your will, put together a list of bank accounts you hold, as well as a record of all your investment and insurance policies and keep it in a safe place, such as a safety deposit box in your financial institution. This will go a long way in helping your executor locate important financial documents quickly.

Store it safely

You will need to provide your executors with information on where your will is stored and how to access it. So, once your will has been correctly signed and witnessed, have it stored – along with your list of important documents – in a secure place. Consider renting a safety deposit box from your financial institution for this purpose. Given the critical importance of your will in determining financial decisions after death, you want to make sure that it’s protected from fire, flood, damage, or loss.

This is perhaps one of the more difficult topics I have addressed in my column. Taking the step to put together a will can be a challenging one because it can force us to confront our own mortality. But we can’t avoid it as it’s a necessary part of planning your finances. If you haven’t yet done so, I hope that this article provides you with the needed background to take that step and book an appointment with your lawyer or notary.

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